Sea of people came to support the anti-GST rally on Labour Day in Kuala Lumpur. Photo by Danny Chan, Copyright @Demotix (5/1/2014)

Tens of thousands in Malaysia joined the May Day rally organized by 90 NGOs to oppose the Goods and Services Tax (GST) which the government will start collecting next year.

The main rally was held in Dataran Merdeka in Kuala Lumpur, the nation’s capital. Organizers claimed it was the biggest ever Labor Day rally in Malaysia.

The GST was approved by Parliament last month. The government said the new tax, which is a standard in more than 150 countries, is necessary to solve the country’s fiscal woes.

But protesters believe the GST would worsen the poverty situation in the country. Rodney reported why organizers chose the Labor Day to register their opposition to the GST:

The demonstration themed “Anti GST – Until it is dropped” was held to coincide with International Labour Day as people gathered to show their displeasure for the suffering faced due to the rising cost of living and their worry over the impending GST.

Rani Rasiah of the Parti Sosialis Malaysia warned that the GST will shift the tax burden from the rich to the poor:

The GST is a tax on consumers, rich and poor, employed and unemployed. The philosophy behind it is that it is only fair that all citizens pay taxes – even if the playing field is not level.

The passing of the GST is a step backwards in the lives of ordinary Malaysians simply because it will further diminish household income. As a policy, it is regressive as it shifts the burden of tax from the haves to the have-nots. Company taxes will be lowered and the GST will be introduced to make up for the drop in revenue.

But Salleh Said Keruak said the bigger challenge is how to make GST more equitable:

The issue, therefore, is not to oppose the GST or try to block its implementation. What we need to do is to make sure the GST is fair or fairer so that we distribute the task of paying tax in a more equitable manner.

Because Malaysians are so focused on opposing the GST, no one is bothering to look at how to make it fair or fairer and not become a burden to the lower income Malaysians. This, I believe, is what politicians should be looking at because there is no way the government is not going to implement the GST unless we want to see Malaysia going broke 10 years or so from now.

The heart of the matter joined the rally but is not entirely opposed to the idea of the GST

There must be an effective minimal wage policy. Otherwise, those who have no money already, made worse by GST next year, cannot survive. What do you think they will do, when there is no bread on the table and no clothes for their kids to go to school. What do you think they will do? They will have to rob, steal and do whatever is necessary for survival. That puts you and I in great danger. Greater danger than now.

There were various estimates about the size of the crowd but it is definitely not 500 as reported by state-run papers.

Government-run Bernama caps its series of negative reports with ‘Anti-GST rally ends earlier, as some violate Peaceful Assembly Act’ claiming the presence of children as a violation.

The report continues to highlight complaints of traffic jams, foiled travel plans and shopping for the day's holiday over the tens of thousands who have protested against what is called an unfair tax in the face of unimpeded government overspending and wastage.

The government first introduced a GST bill in 2009 but it was shelved when it ignited a series of large protests. After embarking on an aggressive information drive in recent years, the government is confident the people are ready to accept the rationale of implementing the new tax.